How the United States Funds the Arts National Endowment for the Arts

National Endowment for the Arts

How the United States Funds the Arts

October 2004 Published by National Endowment for the Arts Office of Research and Analysis Mark Bauerlein, Director

October 2004

Prepared by Tyler Cowen, Department of Economics, George Mason University, and the staff of the National Endowment for the Arts.

Cover: The Cloud Gate Dance Theatre of Taiwan’s Chou Chang-ning, Sung Chao-chiun, and Sheu Fang-yi in Cursive, a work co-commissioned by the University of Iowa’s Hancher Auditorium and supported by the National Endowment for the Arts. Photo by Liu Chen-hsiang

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CONTENTS

Preface by Dana Gioia ...... v

I. Introduction ...... 1

II. Direct Public Support for the Arts ...... 3

III. Other Public Support for the Arts and Culture ...... 8

IV. Private Giving and Tax Incentives ...... 15

References ...... 23

NATIONAL ENDOWMENT FOR THE ARTS iii

PREFACE obs

The Role of a Federal Arts Agency e Jac anc y V o b Phot Dana Gioia, Chairman National Endowment for the Arts

he role of a federal agency in funding survive on the margins of the culture, if they the arts is often misunderstood—and survive at all. for very good reasons. The American The subsidies awarded by ministries of system of arts philanthropy is complex culture are enormous by American standards. andT ever changing. As Chairman of the National For example, the government subvention for Endowment for the Arts, I have constantly been Italy’s major opera houses is nearly ten times impressed by the ingenious diversity and larger than the annual Endowment working endless creativity of ways in which the arts are budget. This support allows major Italian funded in the United States. I thought it might be companies to present opera at the highest useful to provide—for both Americans and an artistic standards. And yet, some of these international audience—a concise overview lavishly supported houses do not stage a single of how America’s unique system of arts production in some years because of philanthropy works. organizational problems, labor issues, or In order to understand how the National reconstruction. Government support, therefore, Endowment for the Arts—and arts funding in does not solve all artistic and organizational the United States—operate, it is helpful to have problems, or guarantee that an institution serves some basis for comparison. By looking abroad, its local community. we can see how other nations manage similar In contrast to the European models, the cultural institutions. In countries like France, U.S. system of arts support is complex, Germany, Mexico, or China, most arts funding decentralized, diverse, and dynamic. It combines comes from the government—either at a federal federal, state, and local government support or local level. These systems tend to be simple, with private subvention from individuals, fixed, and centralized, often focused in a large corporations, and foundations, as well as box ministry of culture. These organizations are also office receipts. The financial statistics differ by typically political, as arts personnel are usually art form and change from year to year, but in members of civil service or political appointees general terms about one-half the income from the ruling party. These systems provide American arts organizations receive is earned smooth and stable planning for arts from box office or sales. The rest is donated— organizations, but they also divide the overwhelmingly from the private sector. cultural world into insiders and outsiders. The Only about 10 percent of arts support in the insider institutions tend to be well subsidized U.S. comes from the government, and only about with large annual grants while the outsiders 2 percent from the federal government, of which

NATIONAL ENDOWMENT FOR THE ARTS v

slightly less than 1 percent comes from the goals and communities. The best institutions National Endowment for the Arts. (The figures make themselves irreplaceable in their on government support exclude the enormous chosen fields. indirect subsidy the federal government This cultural dynamism also provides new provides by making cultural contributions tax groups the chance to grow. Chicago’s deductible.) The amount of federal government Steppenwolf Theater did not exist 30 years ago. support is miniscule by European standards, Now it is one of the nation’s leading theater and yet the American system works. How can companies. Jazz at Lincoln Center is even more this be? recent. In little more than ten years it has become the world’s largest nonprofit jazz organization. It is worth noting that the NEA Decentralization and Diversity played an important role in fostering the growth Like most free market or mixed market systems, of both organizations. American arts philanthropy is complex precisely Some of these new institutions are quite because it is decentralized and dynamic. Similar amazing. Rimrock Opera of Billings, Montana, for institutions often have wildly differing results example, is the only opera company in the because of their locations, artistic talent, nearly 800-mile stretch between Bozeman, cultural philosophies, and management. Montana, and Fargo, North Dakota. Only five Likewise, the dynamic nature of the system years old, Rimrock now not only brings opera to means that one decade’s high-flying leader can its own community but also tours rural Montana suffer huge reversals in the next—just as in and Wyoming from Glendive and Miles City to corporate America. While no one relishes the Cody and Casper, the sparsely populated high ups and downs of the cultural economy, it plains and mountain territories where the deer does have the healthy effect of keeping artists and the buffalo still roam. These are places that and institutions realistically focused on their Verdi, Puccini, and Donizetti have never before been performed. As my Italian grandfather used to say in astonishment, “Only in America!” Jazz at Lincoln Center, featuring the Lincoln Center Jazz Orchestra (pictured), has become the world's If the American arts system is remarkably largest nonprofit jazz organization in just over ten complex, decentralized, and dynamic, it is also years. Photo by Keith Major uniquely effective—producing a cultural landscape of enormous size and unmatched diversity. No one—not even the NEA—has exact statistics on American cultural institutions because they change so rapidly, but an expert estimate of different fields leads us to some astonishing numbers. There are now more than 1,500 professional theaters, large and small, operating in the U.S. There are also more than 1,200 symphony orchestras, plus another 600 youth orchestras, as well as roughly 120 opera companies. Meanwhile, there are approximately 5,000

writers’ conferences now offered around the nation. Nonprofit organizations such as the Poetry Society of America in New York or the Writers Place in Kansas City present public readings of authors on a regular basis. These groups display enormous variety. Among the 1,200 symphony orchestras, some are huge professional organizations like the Boston Symphony that offer year-round concerts A performance of Tchaikovsky's opera The and international tours. Others are small Queen of Spades at the Spoleto Festival USA, amateur groups like the Cotati Philharmonic (in which benefitted from early NEA support. my home county of Sonoma, California) that Photo courtesy of the Spoleto Festival USA gather to produce a few local performances each year. Some orchestras focus exclusively on Arts Endowment. It also ignores the remarkably modern and contemporary music. Others cover productive history of the NEA and its well- the entire symphonic repertory. Smaller groups documented, if not equally well-known, record specialize in Baroque and Renaissance music. of transforming American culture. Finally, this That diversity, size, and scope is confusing to perspective equates NEA effectiveness purely in anyone trying to summarize the field, but they terms of dollars without any recognition of how reflect the vitality of American classical music. that money is spent. In such a rich and dynamic artistic culture, The National Endowment for the Arts has a what meaningful role can the National proven ability to initiate and sustain powerful Endowment for the Arts play? The NEA’s 2004 trends. During the 1970s and 1980s, under the budget is only $121 million dollars—of which leadership of Nancy Hanks, Livingston Biddle, $100 million is distributed after agency overhead and Frank Hodsoll, the NEA slowly transformed is taken into account. In other words, what role American cultural life. It consciously created can be played by an institution that provides the vast system of regional theaters, opera slightly less than 1 percent of total arts funding? and dance companies, and orchestras that This situation is further complicated by the America now enjoys. NEA’s public mandate to support all of the arts, During this time, certain laws of what we as well as arts education, in all 50 states, as well might call American cultural microeconomics as in the six U.S. territories. emerged. In case after case, the NEA learned that its grants had a powerful multiplying effect. Every dollar that the NEA gave in grants Multiplying Effects typically generated seven to eight times more From a European perspective, the NEA would money in terms of matching grants, further seem doomed to perpetual marginality. The donations, and earned revenue. A $100,000 institution is surely too small and too stretched grant, therefore, delivered $800,000 in eventual to make a difference. As reasonable as that funds to an organization. The reason for this verdict sounds, I would maintain that this multiplying effect is obvious: NEA funding has defeatist perspective is wrong. It misunderstands the power to legitimize a new organization both the nature of the U.S. arts world and the and further validate an existing one. Such

NATIONAL ENDOWMENT FOR THE ARTS vii

endorsements attract further support. As formulation of the Arts Endowment’s role in the old saying goes, “Nothing succeeds like American culture. The NEA does not dictate success.” In this way, early NEA support helped arts policy to the United States; instead, it enters create major ongoing arts organizations as into an ongoing series of conversations about diverse as the American Film Institute, the our culture, out of which emerge thousands Spoleto Festival USA, and the PBS series Great of collaborations, large and small, national, Performances. regional, and local. NEA leadership cannot work Although the Endowment represents less by centralized fiat. It operates effectively only than 1 percent of total arts philanthropy in the by fostering and sustaining partnership. U.S., it nonetheless remains the nation’s largest A decentralized and constantly evolving annual funder of the arts. This fact demonstrates system of private and public support for the arts the radical decentralization—and therefore is more than just a political practice. It goes to diversity—of the American system. Just because the heart of artistic freedom, experimentation, a system is decentralized, however, doesn’t and diversity. With resources and funding spread mean that it lacks leadership, trends, or across a variety of agencies, foundations, and direction. Consider the stock market, where a other institutions with different values and goals, single company’s earning results can trigger a no single power sets the cultural agenda and no rise or fall in overall market results. single creed or outlook dominates. The result is An astonishing amount of the media an energetic mix of traditional and experimental discussion of the NEA overlooks an obvious fact approaches, Western and non-Western about its past, current, and presumably future inspirations, populist and elitist perspectives, situations—namely that the Arts Endowment folk and fine arts. cannot and has never operated like a centralized The following report provides a brief but ministry of culture. It has never possessed the comprehensive overview of how the arts are resources to impose its will on the American funded in the United States. It also addresses arts world. It cannot command or control the the role of the National Endowment for the policies of individual institutions. Arts and other public agencies in this decentralized and protean process. American arts funding is complex, with many direct and Leadership through Collaboration indirect sources, both private and public, Rather than being disappointed about the lack playing a part. This report attempts to clarify of central control, I consider this realization of some of the relationships and provide a clear our limits in purely neutral terms. Objective understanding of how the United States funds self-assessment is the proper and inevitable the arts. Although the American model may be basis on which any truthful vision of the NEA’s difficult to understand, the extraordinary vitality future must be built. I feel, therefore, absolutely of our artistic culture demonstrates that it works no disappointment in the fact that the Arts remarkably well. Endowment cannot dictate the terms of American culture. That putative weakness is actually one of the agency’s basic strengths. To build on the implied metaphor of Dana Gioia “dictate,” let me offer a more democratic verbal Chairman

viii HOW THE UNITED STATES FUNDS THE ARTS

I. INTRODUCTION

he world of arts and culture in the United States is extraordinarily complex and fertile. Citizens who enjoy the arts can choose from a wide array of drama, Tvisual art, dance, music, and literature available in local theaters, museums, libraries, universities, performance halls, and nightclubs, as well as on radio and television. In the last 20 years, the arts and culture sector has boomed as the number of performing arts groups and the revenues from sales and attendance have risen to all-time high levels. The proliferation of U.S. arts institutions and revenues has been mirrored by substantial gains in financial support for the arts. Private philanthropy has increased dramatically since 1960, and public agencies expressly devoted to the arts have come into being through acts of U.S. Congress. Private donors have created endowments, and foundations have placed the arts at the center of their portfolios. In this fluid and evolving world, the directors of arts organizations face a two-sided challenge. Lloyd Notice as Othello and Kathryn Merry as On one side they must cope with rising Desdemona in the final scene of the Aquila Theatre expenditures for artists, artworks, productions, Company’s production of Othello. Photo by A. Vincent Scarano and educational projects. On the other side, they forecast the revenues needed to support the former. The revenues themselves are sources: “earned income” (ticket sales, unpredictable, though, and come from dual subscriptions, etc.) and “unearned” or “contributed income,” that is, private and public sector donations of money, time, and resources. The report was prepared by Tyler Cowen, Department of Economics, George Mason University, and the staff To people outside the American art world, of the National Endowment for the Arts. the funding system must appear a labyrinthine

NATIONAL ENDOWMENT FOR THE ARTS 1

Corporations: 7% Earned Income Foundations: 13% 50%

Private 40%

Individuals: 20%

Contributed Income Local: 6% 50% Federal: 2%

State: 2% Financing Nonprofit Arts Organizations in the U.S.

Estimates from multi-year data. These numbers Public do not include private tax deductions for giving to the arts and culture, currently estimated at 10% $5.4 billion.

network of public and private entities, tax tend to regard the arts as separate from fiscal policies, legislative allocations, donated policy, but in fact the arts are a substantial part bequests, restricted endowments, education of the economy, driving tourism, motivating mandates, and social agendas. The hierarchy of business and residential relocation trends, government agencies, composed of city, county, shaping schools, and employing approximately state, regional, and federal strata, is a dizzying two million professional artists. If international scheme, especially to those foreigners whose cultural exchanges are to be meaningful, the own nations have highly centralized, state- relations between public/private funding and directed systems. It is no wonder that the the artworks, performances, and education that financial mechanisms of American arts policy they ensure must be understood in all their and practice are poorly understood. complexity, if only to explain how a nation This monograph explores the entire funding founded on principles of political freedom network and details how the financial system in and capitalism should have produced such the United States fosters artistic creativity and rich traditions and widespread participation preserves artistic traditions. Commentators among its citizens.

2 HOW THE UNITED STATES FUNDS THE ARTS

II. DIRECT PUBLIC SUPPORT FOR THE ARTS

ost discussions of arts policy bureaucracies. The idea of the cultural ministry start with the idea of direct has never been popular in the United States. public subsidies. Typically, a Second, the American system has drawn government agency will use from the British tradition of “arms-length” Mselection procedures and then write checks to government institutions, such as arts councils. artists and art institutions. In many cases a Third, America has a large, ethnically diverse government will erect a formal agency to population and heritage. Fourth, Americans use administer all of the country’s arts programs the tax system to support the arts, as will be and steer the development of its culture. discussed further below. By contrast, the American system uses a These features are sometimes regarded as regime of incentive grants and relies on a weakening the American commitment to the principle of decentralization. There is no arts, but they can make direct grants more cultural ministry, and no single agency or effective as well as guaranteeing more diversity institution controls more than a small and greater freedom in the arts. In the U.S., percentage of the funds distributed. The direct grants are less likely to politicize the arts, National Endowment for the Arts, one of the and American artists are not required to court a largest funding institutions, accounts for a political establishment. The granting agencies small fraction of aggregate support for the arts. are not expected to oversee an entire culture or Direct public support should not be to provide the bulk of the required identified with the concept of an arts policy. entrepreneurial energies. Direct grants will never finance the bulk of If one program or agency makes bad artistic activity in the United States; instead, decisions, its impact is limited in size and they fill gaps, enhance arts education, spread scope. At the same time, the large number new creations, and enable preservation. Direct of independent programs allows for grants complement other means of funding the experimentation and learning. Over time, the arts, not substitute for them. The majority of best ideas and practices can spread to many the Arts Endowment’s grants, for example, different institutions, both private and public. require the recipient organization to couple the Furthermore, no single program or agency award funds with other, non-federal donations. can too greatly influence the general state of The United States has chosen a relatively American culture. To be sure, levels of low level of direct grants for several related accountability are present. Arts programs and reasons. First, Americans are suspicious of the agencies are accountable for the grants they prospect of centralized government make. But no one holds the Arts Endowment

NATIONAL ENDOWMENT FOR THE ARTS 3

responsible if American dance is not very good in a particular year. Its mission is to improve our cultural life and heritage, not to take responsibility for America’s entire creative output. This targeted kind of accountability achieves two ends. First, arts programs and agencies are responsible only for variables under their control. Second, the programs and agencies are 1990 NEA National Heritage Fellow Nati Cano and his band Mariachi Los Camperos performing not tempted to disrupt the more general at the 2004 Smithsonian Folklife Festival. mechanisms of cultural production and Photo by Jim Saah dissemination. Arts programs and agencies in the United States supplement broader processes NEA NATIONAL HERITAGE of creative discovery and education, rather than FELLOWSHIPS substituting the state for the market. The Endowment recognizes the That being said, let us examine a few of contributions of outstanding practitioners of America’s arts programs. traditional art forms in the United States with NEA National Heritage Fellowships. A. National Endowment for the Arts More than 300 exemplary folk and Established by Congress in 1965 as an traditional artists have been selected for the independent federal agency, the National U.S. government’s highest cultural honor, Endowment for the Arts is the designated arts accompanied by an award of $20,000. The organization of the United States government. NEA National Heritage Fellows represent The Arts Endowment is dedicated to supporting the best achievements of diverse artistic excellence in the arts—both new and traditions across the nation. A partial list of established, bringing the arts to all Americans, award-winners reveals the breadth of the and providing leadership in arts education. It program: Native American basket weavers, awards more than $100 million annually— potters and storytellers; African American investing in every state and jurisdiction—which blues, Cajun, Hmong, Sephardic and in turn is estimated to generate more than $700 Mariachi musicians; Basque cowboy poets; million in additional support. The Arts Swedish, Irish, and Appalachian fiddlers; Endowment has played a substantial role in the a Guamian blacksmith; an Eskimo mask development and preservation of folk arts, maker; a German American Bobbin dance, theater, literature, opera, and other arts lacemaker; an Arab American oud player; a that Americans now enjoy. Tibetan sand mandala painter; a Bonsai The Endowment awards matching grants for sculptor; African American and Appalachian projects undertaken by nonprofit organizations. quilters; Lebanese and Puerto Rican musical In addition, it awards non-matching individual instrument makers; Cambodian traditional fellowships in literature and lifetime dancers; Appalachian songwriters; and achievement awards in jazz and the folk and Orthodox Byzantine icon and Santos traditional arts. Forty percent of the Arts woodcarvers.

4 HOW THE UNITED STATES FUNDS THE ARTS

Endowment’s funds go to the 56 state and economic conditions in the state. In 2003, state- jurisdictional arts agencies and the six regional level expenditures were at $354.5 million, falling arts organizations in support of arts projects to $273.7 million in 2004, a 23 percent decline. in thousands of communities across the In 2002 and 2003 many state arts budgets came country. In general, support is provided for under strong fiscal pressures, in part because projects that nurture creativity and provide state governments were required to balance accessibility to the arts. For instance, the their budgets with falling revenues. California Endowment awards matching grants to small cut its arts budget from $20 million to $2 million, presses to help literary works reach American Florida cut from $30 million to $6.7 million, and readers. Part of its mission is to ensure Michigan cut from $22.5 to $11.7 million. availability of the arts outside the major cities and to protect indigenous and regional cultures. Applications generally receive three independent levels of review for artistic excellence. First, they are reviewed by independent panels of nationally recognized artists and arts experts. Recommendations are forwarded to the National Council on the Arts, the Arts Endowment’s advisory body comprised of renowned artists, distinguished scholars, and arts patrons appointed by the President and confirmed by the U. S. Senate, and ex-officio members of Congress. The Council reviews grant applications and makes recommendations on which applications to fund. These recommendations are sent to the Chairman of the National Endowment for the Arts, who reviews them and makes the final decision on all The Oklahoma Arts Council provides funding for a variety of programs, such as their apprenticeship grant awards. The Chairman of the Endowment, program in mandolin-making in which master appointed by the President with the advice and mandolin maker Nicholas Richardson participated. Photo courtesy of the Oklahoma Arts Council consent of the Senate, serves a four-year term. The National Endowment for the Arts is only one of several federal agencies that support Although a few arts agencies had increases culture. Other important federal agencies are (such as Mississippi, which rose from $1.7 discussed later in this monograph. million to $3.8 million), many other states enacted small cuts and some states talked about phasing out their arts councils altogether. B. State Arts Agencies But the state-level fiscal crises may have peaked, Federal arts funding is complemented, indeed, and large cuts to state arts budgets appear to exceeded, by state arts appropriations. State have ended. arts appropriations are dependent upon state While state arts agencies came into being tax revenues, which are tied to the general in the 1960s and 1970s, much of the financial

NATIONAL ENDOWMENT FOR THE ARTS 5

growth in the state institutions came in the staggered fashion. A few states have cabinet- 1980s. In 1979, Arts Endowment funds were level departments with responsibility for 80 percent greater than state legislative cultural policy. appropriations; but by 1989, state appropri- Sometimes cultural nonprofits receive ations were 60 percent higher. direct inclusion in the state budget through line- The Arts Endowment and the state agencies item appropriations. In Connecticut, line-item are partners in funding the arts. When the appropriations have accounted for as much Arts Endowment was established in 1965, five as 73.7 percent of total state arts spending. states had official arts agencies or councils. But A few states (Alabama, California, Illinois, from the beginning, the Arts Endowment Missouri, Montana, Rhode Island, and West supported the development of state arts Virginia) have stood in the 30 to 50 percent agencies and, by the mid-1970s, gave at least 20 range for their direct appropriations, at least percent of its program funds to state arts until recent cuts. Nonetheless line-item agencies and regional arts organizations. The appropriations are small for the median state potential for grants induced states to set up arts and often are zero. On average, line-item programs and councils; it is no coincidence that spending has accounted for roughly 16 percent most state arts agencies were founded shortly of state arts expenditures. after 1965. The New York State Council on the Arts C. Local Arts Agencies (NYSCA) is the largest state agency; its 2003 budget was $51.5 million. New York State had Americans for the Arts estimated total arts arts relief programs during the Great Depression, expenditures at the city and local level at $770 starting as early as 1932. NYSCA was founded in million in 2003. The U.S. Urban Arts Federation, 1960 and provided an early model for the Arts which includes only the 50 largest local arts Endowment in terms of its funding patterns and agencies, forecasted 2003 expenditures of $338 system of peer review. million by its members. The single largest urban State-level arts support—appropriations funder is the New York City Department of from state legislators—does not deviate Cultural Affairs; in 2004 this agency funded the dramatically from Arts Endowment spending arts at a level of $118.8 million. The second patterns, but there are a few differences. largest urban funder in 2004 was the San State programs tend to support smaller and Francisco Arts Commission, with expenditures more local organizations, and younger, less of $25.5 million. established artists. State arts agencies As with state-level grants, local and city-level support community groups, whereas the grants have a scattered history. After the Arts Endowment typically does not. State success of the Chicago World’s Fair in 1893, programs are also more likely to support many American cities set up art commissions arts “applications” in the fields of health, as part of their urban planning policies. Often penology, and gerontology. their budgets were no more than a few thousand State funding procedures follow broadly dollars, but they had authority to commission common patterns. A council or commission, public improvements and artworks. In some with approximately 15 members, will set funding cases, these institutions provided independent policy. Governors appoint council members in support for the arts, rather than just

6 HOW THE UNITED STATES FUNDS THE ARTS

AMERICAN THEATER commissioning works for public buildings and spaces. Today, there are more than 1,500 The first municipally supported art professional theaters across the 50 states collection (later discontinued) came in Chicago providing live performances, education, and in 1914. In 1915, Baltimore was the first professional training for different audiences. American city to have a municipally supported The regional and local institutions show that orchestra. The Detroit Museum of Art was development of new theatrical productions turned over to the city in 1919, in return for a does not take place only within the large new building. Philadelphia made the first established theaters in major cities. New American municipal opera grant in 1923. works are supported through initiatives Between 1870 and 1910, local and state such as the National Endowment for the governments accounted for 40 percent of the Arts/Theatre Communications Group funds available for museum building. By 1930, Theater Residency Program for Playwrights, municipalities were spending $2.5 million a year which helps playwrights produce new plays on art museums. in small and mid-sized theaters. For New York City support for the arts dates example, playwright Nilo Cruz crafted a from nineteenth-century commissions of public new play, Anna in the Tropics, at New sculptures. In the 1890s, the New York Art Theatre in Coral Gables, Florida. His play Commission was founded; its mission was to about cigar makers in 1929 Tampa whose oversee the attractiveness of public buildings lives were transformed by literature was and parks. The city already had played active recognized with a 2003 Pulitzer Prize roles in the Metropolitan Museum of Art, the for Drama. New York Public Library, and the Brooklyn Museum of Art. These discretionary interventions date as far back as the 1860s. Urban involvement in the arts grew steadily after the Second World War. In the latter part of the twentieth century, many American cities decided to expand their presence as regional arts centers and magnets for tourists. These city governments moved towards subsidizing a wide variety of artistic institutions, including museums, art spaces, historic buildings and neighborhoods, and symphony orchestras. Local involvement takes numerous and diverse forms. Community development initiatives may involve the performing arts, support arts education, or foster artistic and architectural heritage programs. While there are no systematic figures, local government art expenditures go well beyond the formal arts agencies.

NATIONAL ENDOWMENT FOR THE ARTS 7 Image by SpotCo, courtesy of TCG

III. OTHER PUBLIC SUPPORT FOR THE ARTS AND CULTURE

he decentralization of U.S. government 2004 Budgets for Selected U.S. Federal cultural subsidies is reflected in the and Quasi-Governmental Organizations variety of federal agencies that have Funding Arts and Culture programs to support the arts and (dollar amount in millions) Tculture. Some agencies are independent units specifically devoted to the arts, while others Smithsonian Institution $489 are arts programs directed by large government Corporation for Public Broadcasting $377 offices unrelated to arts concerns, such as Institute of Museum and Library Services $262 the Department of Defense. The way the arts National Endowment for the Humanities $135 are supported varies from direct funding of National Endowment for the Arts $121 artists and arts organizations to insurance for National Gallery of Art $88 art works on tour. The exhibitions and Department of Interior $30 performances that ensue appear in an array (Save America’s Treasures) of public spaces, including national forests, Kennedy Center for the Performing Arts $17 military bases, and federal office buildings. Department of Education $10 (Arts in Education Model Development Program) A. Domestic Commission of Fine Arts $8

Cultural programming is made available to the National Capital Planning Commission $8 American people on public television and public General Services Administration $5 (Art-in-Architecture Program) radio. The Corporation for Public Broadcasting (CPB) supports noncommercial radio and Advisory Council on Historic Preservation $4 television programs. The CPB, founded in 1967, There are more than 200 other federal programs that is a private nonprofit corporation, whose board support the arts and culture. is chosen by Presidential appointment. By law, the governing board of ten may not contain more run programming on both popular and high than six members from any single political party. culture. As for PBS, it is estimated that about 28 CPB provides funds to the Public Broadcasting percent of the programs deal with culture. The Service (PBS), National Public Radio (NPR), and programming comes from many different Public Radio International (PRI). Almost three- sources, including from other countries such as quarters of CPB funds are given directly to Great Britain. Sesame Street, produced by the individual television and radio stations. Sesame Workshop (formerly known as the More than 330 National Public Radio stations Children’s Television Workshop), is the best-

8 HOW THE UNITED STATES FUNDS THE ARTS

SMITHSONIAN FOLKLIFE FESTIVAL For the past 37 years on the National Mall, the Smithsonian Institution has celebrated the world’s cultural traditions with a public arts festival. An estimated one million people attend each year. More than 16,000 musicians, performers, artists, craftspeople, and storytellers have participated. In 2002, the known children’s show to have appeared on Smithsonian Folklife Festival’s theme was “The public television. Three large PBS stations— Silk Road: Connecting Cultures, Creating Trust,” Boston, New York, and Washington—produce which showcased the music, art, architecture, slightly more than half of the national programs, and food of 20 countries on the famed trading with the remainder being either a local product route from Italy and Turkey to Kazakhstan, or imported from abroad. Bangladesh, and Japan. Puppeteers from The CPB appropriation for 2003 is $362.8 India, Chinese papermakers, Syrian glass million. Public television, however, is very blowers, and musicians from Armenia were just much a mixed private-public enterprise. In a a few of the artists and artisans who took part. typical year, the federal government supplies no more than 15 percent of the public television The annual two-week festival receives public, budget through grants, and another few percent foundation, and corporate support. The through direct contracts. State and local Smithsonian event is one of hundreds of governments, combined with public universities, heritage events and festivals—such as mariachi put up 30 percent or so. The remainder comes festivals, exhibits of Native American art, from viewer memberships and subscriptions, and African dance and music performances, and from private corporate and foundation support. Chinese instrument youth orchestras—that take The Smithsonian Institution, which runs 15 place every year and are made possible with museums, maintains research centers, manages federal and state government grants. the National Zoo, is affiliated with the National Gallery of Art, and is an independent institution inside the federal government. A Board of The annual Smithsonian Folklife Festival on the National Mall provides folk and traditional Regents, with members drawn from the music and crafts from across the U.S. and United States government and the citizenry around the world. at large, governs the Smithsonian. Regular Photo by Barry Bergey appropriations come from Congress, and in fiscal year 2003 the net budget authority ran to $446 million. Its private endowment, while it fluctuates in value, has stood as high as $755 million. The Smithsonian museums include the Hirshhorn Museum (sculpture and modern art), the National Portrait Gallery, the National

The National Gallery of Art is supported by the federal government, but its world famous collection has come from private donations. Photo courtesy of the National Gallery of Art

Collection of Fine Arts, the Renwick Gallery, and 400 art works to the project, and after the the Cooper-Hewitt Museum of Decorative Arts National Gallery opened on the Mall in 1941, and Design. The newest addition to the further private giving arrived with the Widener, Smithsonian museums is the National Museum Dale, Rosenwald, and O’Keefe donations. of the American Indian, which opened on The Institute of Museum and Library September 21, 2004. Services (created in 1976 as the Institute of The National Gallery of Art, one of the world’s Museum Services) supports museums, zoos, premiere art museums, received an appropriation botanical gardens, and libraries, and is now of $79 million in 2003 from the U.S. Congress. The spending $262 million a year. Of this total, history of the Gallery exemplifies the private/ $31.4 million is allocated to museums; most of public partnerships that are the hallmark of the remainder goes to libraries. The John F. American arts institutions. It began in the 1920s Kennedy Center for the Performing Arts when Secretary of the Treasury Andrew Mellon receives a direct appropriation, currently in envisioned a national art museum in the nation’s the neighborhood of $17 million, as do a few capital. In 1936, Mellon offered to donate his art small programs that support the arts in the collection to the nation and to personally finance District of Columbia. the construction of a museum to house it on The Federal Council on the Arts and the public land. Soon after, Congress passed Humanities, which is administered by the legislation to establish the National Gallery of National Endowment for the Arts, oversees the Art as an independent bureau within the Arts and Artifacts Indemnity Program that Smithsonian Institution. With construction well insures foreign objects exhibited in American under way in 1939, Samuel Kress added almost museums. The Indemnity Program was created

10 HOW THE UNITED STATES FUNDS THE ARTS

by Congress in 1975 for the purpose of commissions and funds art for public buildings. minimizing the cost of insuring international Since 1979, GSA has spent one-half of one exhibitions. Since its inception, the program has percent of construction costs for federal indemnified nearly 800 exhibitions, saving U.S. buildings on artwork, which is then owned by museums more than $160 million in insurance the federal government. In 2001, the program premiums. The Arts and Artifacts Indemnity initiated projects with a collective budget of Program was substantially increased in 2003 $4.5 million. As of 2001, the program had 260 to provide up to $8 billion in total coverage. projects and another 65 in the works. Risk management for this program has been so The National Endowment for the Humanities successful that it has never created any costs (NEH) provides funding for scholarly research for U.S. taxpayers. in history, philosophy, literature, religion, ethics, The Art-in-Architecture program is and jurisprudence. Together with the Library of administered by the General Services Congress, the NEH funds programs to preserve Administration (GSA). This program, originally old books by protecting the paper from modeled after the New Deal’s Treasury deterioration. It also funds literary programs for Department Section of Painting and Sculpture, public television, makes grants to museums for exhibits, supports scholarly seminars for teachers, and subsidizes low-price editions of American literary classics. Most NEH programs MAYORS’ INSTITUTE ON concern “the humanities” rather than “the arts,” CITY DESIGN but the two concepts overlap in literature and The National Endowment for the Arts, in museum support. partnership with the American Architectural The Library of Congress and its American Foundation and the U.S. Conference of Folklife Center are active in gathering the Mayors, conducts regular workshops for records of diverse cultures and, through mayors to collaborate with design technology, providing public access to a professionals on solutions to the design and growing archive of three million items ranging environmental challenges of America’s from photographs and manuscripts to audio cities. Participation is limited to 20 persons, recordings and moving images. As the half mayors and half designers. At the country’s largest archive of ethnographic meetings, mayors present their specific field recordings, it preserves materials from design issues, such as waterfront around the world that date from the very first redevelopment and downtown sound recordings of 1880 to the present. revitalization, and designers help them draft The Center is developing an ethnographic solutions. Over the last 20 years, more than thesaurus of cultural archives and collections 600 mayors and 400 design professionals worldwide that can eventually link and be have participated in the Institute, which has interrelated via database technology, enabling been honored with the Presidential Award scholars––and the public––access throughout for Design Excellence, the Progressive the world. Architecture Award from Architecture The U.S. Forest Service funds Magazine, and an Institute Honor Award demonstrations of folk arts and crafts, or from the American Institute of Architects. performing arts activities more generally, in

NATIONAL ENDOWMENT FOR THE ARTS 11

NATIONAL ENDOWMENT FOR THE HUMANITIES The NEH is deeply involved in scholarly projects to preserve local and regional cultures. With assistance from the NEH, the University of Alaska in Fairbanks is preserving and cataloging 132 reels, consisting of 56,600 feet of film, documenting Alaskan native peoples, activities, and settings from 1927 to 1965. Information about the individuals and activities depicted on film will be obtained from Alaskan native peoples and incorporated into catalog records for entry into local and national bibliographic Through the U.S. Forest Service and NEA’s Arts and databases. Rural Community Assistance Initiative, this series of metal sculptures depicting the Blackfeet Tribe’s Napi In the Western United States, the NEH Creation Story was commissioned for the Museum of provides financial assistance to 180 libraries the Northern Plains Indian in Browning, Montana. Photo by Alex Gladstone for bilingual reading and discussion programs called “The Language that Unites Us/El lenguaje que nos une” and “The many national forests. Many national parks Bridges that Unite Us/Los puentes que nos have collections of artwork and support unen” to foster an appreciation for the rich residency programs for artists, under the aegis culture and experiences of Latinos as of the Department of the Interior. The National reflected in the work of noted authors, such Park Service collaborates with the Arts as Julia Alvarez, Carlos Fuentes, Miguel Endowment, NEH, and IMLS in funding a major Méndez, Pablo Neruda, and Sabine Ulibarrí. preservation program, “Save America’s Another collaborative project currently Treasures,” which conserves historic structures supported by the NEH is “Southern African and collections. Additionally, many large-scale Praise Poetry.” Researchers at Ohio State “earthworks” sculptures, such as those of University are working with African Christo or Robert Smithson, have been created colleagues to create a CD-ROM on or placed on public lands. southern African oral literature, specifically Some of the largest government arts on the praise poetry performed in the programs come through the military. The Nguni and Sotho-Tswana languages. budget for the military bands alone exceeds $100 million dollars annually. The United States Armed Services, under the “morale, welfare, and recreation” initiative, presents regular cultural programs for servicemen and servicewomen and their families. Libraries and movie showings are common. The U.S. Army runs a large theater

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program. These programs have a significant influence on the cultural lives of the 1.4 million Americans who serve in the military and their families. The Army Art Collection, an extensive (10,000 plus) holding of paintings, drawings, sketches, and watercolors, records the history of America at war. The military art held by the government includes such notable artists as Jacob Lawrence, Reginald Marsh, Horace Pippin, and Thomas Hart Benton. Working with the armed services, the United Service Organizations Inc. (USO) entertains soldiers by bringing in movie stars, musicians, and other celebrities, especially during wartime. For performances, USO relies on volunteer labor or pays its performers at reduced rates. During World War II, the USO employed 5,424 salaried entertainers and had total show attendance of 172 million. The USO is not part of the federal government, but it does receive its charter from Congress and relies on the U.S. military for its NEA Jazz Master Dizzy Gillespie has led various bands support. The President is typically the on U.S. State Department tours around the world, Honorary Chairman of the USO and formally most notably in the 1950s to South America. Photo by Martin Cohen endorses the agency. The USO today has 120 centers around the world and serves an average of five million individuals each year. were both created at this time. The Voice of America (VOA) transmitted radio programs, often of a cultural nature, as did Radio Free B. International Europe and Radio Liberty. In 1953, the United The arts also receive support from the U.S. States Information Agency (USIA) was created foreign affairs agencies. Diplomacy programs to spread a favorable American image around support the presentation of American arts the world. abroad. State Department and USIA programs sent As the Cold War developed, politicians leading American orchestras, singers, jazz supported the performance of American arts and folk musicians, musical shows, and abroad as a counter to Soviet communism. The instrumentalists on tours of the world. Jazz, Smith-Mundt Act of 1948 called for the spread of modern dance, and avant-garde theater information abroad about American culture and benefitted in particular from federal patronage. government. The Office of International The performers received financial support and Information and Educational Exchange (OIE) a new air of legitimacy, thereby widening their and the United States Information Service (USIS) audience base.

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Cultural diplomacy programs declined with the end of the Cold War. USIA was folded into other State Department programs in 1999. However, the Department still administers the Fulbright exchange programs and runs “artistic ambassador” programs that support performances by U.S. artists abroad, with a budget of approximately $3.4 million annually for the last five years. Cultural broadcasts continue through the Voice of America, Radio and Television Marti (aimed at Cuba), and World Net. Cultural diplomacy is now applied in the Middle East. The recently established Radio Sawa received $35 million from the U.S. Congress to broadcast popular Arabic music and news from an American perspective. A Congressional appropriation also provided $62 million for an Arabic language TV station, Al Hurra [Free One], to broadcast throughout the region. In addition to news and documentaries, the station offers Some of the authors who have received NEA movies, music, and cultural commentary. Literature Fellowships. For many years, the National Endowment for the Arts has supported international exchanges NEA LITERATURE through such programs as the U.S./Japan FELLOWSHIPS AND GRANTS Creative Artists’ Program and ArtsLink, an The National Endowment for the Arts exchange program with Central and Eastern nurtures a multiplicity of literary traditions Europe, Russia, and the Baltics. Recently, the through fellowships to emerging writers and NEA has initiated cultural exchange programs incentive grants to nonprofit literary with Mexico, China, the European Union, and magazines and independent and university UNESCO, as well as expanded the Open World presses to publish, distribute, and promote program that brings Russian artists, arts poetry, fiction, translation, and creative journalists, and arts administrators to the nonfiction by contemporary writers. United States. Through the Translation Fellowship program, established in 1981, the U.S. government has helped support the translation of 218 literary works into English, providing access to foreign literature not generally available to American readers. In 2003 and 2004 alone, the NEA program supported the translation of writers from Albania, Chile, China, Denmark, France, Germany, Greece, India, Israel, Lithuania, Norway, Poland, Portugal, Spain, and Turkey.

14 HOW THE UNITED STATES FUNDS THE ARTS

IV. PRIVATE GIVING AND TAX INCENTIVES

even any particular conception of what a A. Individual and Foundation Giving nonprofit should do. Nonprofits with artistic The tax system provides the most significant programs may serve as talent spotters, direct arts support in the United States. Estimates producers of creative outputs, donors, suggest that Americans donated roughly $12.2 marketers, educators, event organizers, or billion to the category “Arts, Culture, and the preservers of the past. Many nonprofits are Humanities” in 2003. In per capita terms, the small and informal, such as volunteer total amounts to about $42 for each individual in community groups. the United States. Private individuals account The tax incentive motivates a great deal of for about 50 percent of the total, foundations giving. In economic language, donations appear for 33 percent, and corporations account for to exhibit a “price elasticity” in the range of 17 percent. -0.9 to -1.4. In other words, for every dollar the Under the U.S. system, any donation to a U.S. Treasury loses from the deduction, private tax-exempt nonprofit organization qualifies as nonprofits receive additional donations in the a potential deduction for the tax-paying donor. range of 90 cents to $1.40. These numbers It is required only that the taxpayer itemize his suggest that the tax incentive is central to or her deductions, rather than taking the charitable and artistic giving. standard deduction allowed by law. Today Donations fund American nonprofits to a about 60 percent of American taxpayers—most considerable degree. Museums, symphony of all homeowners and the wealthy—itemize orchestras, opera companies, and other cultural their tax deductions. For these individuals, the organizations reap only part of their overall donation of a dollar to a nonprofit institution revenues from ticket or entrance fees. Many of reduces taxes between 28 and 40 cents per America’s leading institutions would not exist if dollar, depending on the individual’s tax private citizens had not bequeathed their position. The tax incentive therefore applies to holdings and invested their resources. most giving to the arts. The estate tax provides Consider some broad estimates for American further incentive to donate wealth rather than symphony orchestras. According to one set pass it along to heirs. of figures, 33 percent of their income comes Donations to other tax-exempt, nonprofit from private donations and 16 percent from institutions—such as charities and churches— endowments and related sources. Concert are also deductible. The U.S. tax system thus income generates 42 percent of revenue, and favors decentralization of nonprofit activities, direct government support provides only 6 rather than any particular conception of art, or percent of revenue. For nonprofit arts

NATIONAL ENDOWMENT FOR THE ARTS 15

Symphony orchestras, such as the Knoxville Symphony conducted by Kirk Trevor (pictured), combine public support with private donations and performance income in order to cover the costs of putting on a season of music. Photo courtesy of the Knoxville Symphony

institutions more generally, individual, nations. If we look at individual donors, corporate, and foundation donors make up Americans give almost ten times more to about 45 percent of the budget. Twelve percent nonprofits on a per capita basis than do their of their income comes from foundation grants French counterparts. This dramatic difference alone. While these numbers fluctuate each year, reflects distinctly American social and cultural they provide a rough measure of the appropriate traditions, which have become institutionalized magnitudes at hand. in public tax codes. For purposes of contrast, a theater or Historically, European governments have orchestra in Germany will likely receive 80 not offered comparable tax benefits to their percent or more of its budget from direct arts, although the trend is toward offering more governmental support. In France and Italy, benefits. France limits tax deductions to 1 government support at various levels accounts percent of taxable income for individuals and 0.1 for almost all of the funding for a typical percent for corporations. Germany has allowed museum. Even the Louvre, which was asked to tax deductibility in law but made the deduction find private funding as of 1993, raises less than unwieldy through bureaucratic restrictions. half of its operating budget. In the United Britain allows tax deductions, but also makes States, however, direct government support them difficult. Typically, a taxpayer has had to accounts, on average, for no more than 5 agree to make payments for at least seven years percent of the total budget of nonprofit arts to earn the deduction. Furthermore, the organizations. donations have not always been deductible at Individual private philanthropy to the arts the top marginal tax rate but rather at a lower is virtually nonexistent in most European rate. Some European countries, such as France

16 HOW THE UNITED STATES FUNDS THE ARTS

and Italy, have few private foundations. Legal variety of high culture enterprises, most of all restrictions and unfavorable tax treatment make museums, orchestras, and libraries. The Ford these organizational forms very costly. and Rockefeller Foundations have also Often it is Americans who serve as the recognized less mainstream art forms, such as leading donors to some European arts modern dance, Beat poetry, and Latino music. institutions. In the mid-1980s, J. Paul Getty In addition to these larger entities, small donated $62.5 million to the National Gallery in private or family foundations also give London, the largest donation the institution has significant amounts to the arts. The legal and received. The Tate has raised significant institutional environment of the United States American funds as well. To capture such supports the number and diversity of these donations, many British nonprofits now have foundations. Some institutions, such as the American affiliates with tax-exempt status in Bradley Foundation, foster traditionalist the U.S. projects; others such as the Dia Art Foundation In the United States, donations of volunteer specialize in supporting the avant-garde. time—equal in scope to 390,000 full-time It can be worthwhile to start a foundation for volunteers—are a large part of the broader sums smaller than a million dollars. Particular philanthropic picture. As of the early 1990s, the kinds of foundations offer specific or targeted average time donor had an income of more than advantages. Legacy foundations allow an $56,000. The implicit dollar value of these time individual to make a gift during his or her donations thus stands above $20 billion, with lifetime and receive a tax deduction in the some estimates going as high as $25 billion. current year. The gift is not passed along until American foundations are significant in their the individual dies; in the meantime the size and scope. Recent estimates put foundation individual can receive income from the gift assets at around $400 billion. Furthermore, the assets. Family foundations allow the board flow of new money into foundations is ongoing. of directors to be comprised of family From 1981 to 1999, 84.5 percent of the increase in members only. foundation assets (which rose almost threefold over that period) came from new donations and B. Corporate Giving the creation of new foundations, rather than from returns on existing foundation assets. Corporate giving also is more decentralized than The foundation sector consists of more than is commonly believed. Three-quarters of arts just a few major institutions. A 1992 estimate spending comes from smaller companies with has the top 25 institutions accounting for no revenues of less than $50 million. Ninety more than 40 percent of foundation arts funding; percent of that money goes to local arts the rest comes from widely scattered sources. organizations. Data from the 1990s show that 47 Of all the foundations, Getty is the largest; its percent of all businesses surveyed gave money $4.5 billion endowment generates up to $250 to the arts, and that businesses devoted an million in yearly arts spending. Getty has used average of 19 percent of their philanthropic the money to build an art museum and art budgets to the arts. The most popular grants research center in Los Angeles. were to symphony orchestras (15 percent), The Ford, Carnegie, and Mellon foundations, performing arts centers (13 percent), museums among many others, have supported a wide (12 percent), and theaters (11 percent).

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Corporate giving, like private and foundation through state governments. The project had an giving, has been influenced by public policy estimated value of $20 million, which meant that decisions. Corporations have received tax the available tax credit was about $900,000 per breaks for supporting the arts since 1936. As year. This sum is paid out yearly for ten years, with individuals, corporations give more to the or $9 million in total. The Artspace used these arts when they receive tax benefits for doing so. tax credits to get a bank loan of $7 million, and Many of the tax benefits for the arts are then set up a corporate partnership, in essence piecemeal in nature; they are not easily “selling” the tax credits to the corporate partner measured in the aggregate. For instance, artistic for cash. Artspace also financed 20 percent of institutions benefit from local tax breaks and the $20 million cost from the Historic Tax Credits legal provisions, often under the guise of urban available through the Department of the Interior, renewal. Skillful artistic entrepreneurs can put again “selling” these tax credits for 93 cents on together packages of direct and indirect the dollar. Of the $20 million total, $11 million subsidies, drawing on a wide variety of sources. was now in hand, and construction could begin. Consider one example. The Minneapolis County and state tax programs served to Artspace organization wanted to renovate a complete financing, and the remainder was decrepit warehouse and turn it into artists’ raised from private foundations, again with an apartments and studios. They started by going implicit tax break for the donations. to the State Housing Finance Agency and Other inventive designs for supporting the applying for Low Income Tax Credits available arts will surely follow in the coming years. for renovation projects. These credits are paid One novel approach is that of the Arts Council for by the federal government but allocated Silicon Valley. The Council recognizes that

Potter Brad Henry is a resident of St. Paul, Minnesota’s Northern Warehouse Artists’ Cooperative, a former warehouse turned into artists’ studios by Minneapolis’s Artspace. Photo by Jeffrey Hanson

organizations must work within an environment Louisiana State University Press after being that provides financial incentives for businesses rejected by numerous commercial publishers. to donate to the arts. So, it has devised The book won a Pulitzer Prize and is now inventive programs for employers and considered a classic. American colleges and corporations to create efficient donation universities operate more than seven hundred strategies beneficial to their portfolios. art museums. College radio stations, and the college tour circuit, are critical to the success of independent rock bands and do much to foster C. Universities musical diversity. Universities are significant conduits for government support of the arts. By subsidizing D. How Nonprofit and For-Profit universities, federal and state governments Sectors Interact provide employment for painters, writers, musicians, and other creative artists. Although America started from an under- In the world of classical music, almost every developed cultural base in the eighteenth composer serves as a “guest composer” at a century, it has become an acknowledged leader university for some period of time. Many in abstract art, contemporary classical composers teach as full-time faculty and composition, modernist fiction and poetry, collaborate with campus-based musicians to theater, jazz, and modern dance, to name just a premiere new music. Professional performing few fields. Artistic nonprofits and the American groups, such as the Cypress String Quartet at tax system have supported each of these San Jose State University in California, use endeavors. academic residencies as a base for regional and That being said, subsidies to artistic national touring. nonprofits benefit for-profit enterprises as well. Roughly two dozen universities commission Too frequently, commentators paint a picture of new artworks. Creative writing programs, often one subsidized cultural sector and another at state or state-subsidized universities, train entrepreneurial cultural sector. In reality, American writers and help them connect with popular culture often draws upon nonprofit publishing houses. Hollywood relies on film culture for its “research and development” schools, including the film school at UCLA—a efforts (and to some extent vice versa). Indirect state university—to educate and recruit future subsidies to the arts have made American directors. Much of the American avant-garde popular culture much stronger. theater is based in drama workshops at colleges Hollywood, for instance, draws on stories and universities. Architects look to universities and ideas produced by the nonprofit sector. for their basic training, as do many individuals in Driving Miss Daisy, The Gin Game, On Golden music technology and production. Universities Pond, Children of a Lesser God, Glengarry Glen also subsidize literary magazines. Ross, and Prelude to a Kiss all started as nonprofit University presses publish many works, theatre. Over a recent 20-year period, 44 percent including fiction, which commercial houses of the new plays produced on for-profit reject. Some of these books have won Broadway originated in the nonprofit sector. significant honors. John Kennedy Toole’s The literary world blurs the nonprofit and A Confederacy of Dunces was picked up by for-profit sectors as well. Public libraries and

NATIONAL ENDOWMENT FOR THE ARTS 19

agencies. The public and private aspects of FILM FESTIVALS AND support are ever in flux, and the mechanisms PROGRAMS IN THE UNITED of delivery mingle the best of charitable giving STATES with entrepreneurial ingenuity. Funding goes to artists, museums, theaters, orchestras, Nonprofit film programs and festivals flourish schools, presses, community centers, cities, in the United States. Some film festivals and states, and the purpose of funding ranges focus on the general—the screening of from the creation of new art to the preservation independent films, short films, and foreign of the old, from teaching children basic skills films. Others have a specific emphasis; for to providing master artists with needed example, Asian film, documentaries, Latino resources. productions, or children’s film. The common The funding network is diverse and thread is that they all provide opportunities perplexing, to be sure, and sometimes arts for audiences to see work in different genres, organizations do not survive the vicissitudes of from America and abroad. NEA support was the economy. But, simultaneously, the flexibility instrumental in the establishment of the of the American system may rightly be credited Sundance Institute for Film and Television, a with fostering the boom in art making and arts nonprofit organization in Salt Lake City, Utah participation that we have seen in the last 40 that offers a program for emerging years. New arts organizations are constantly screenwriters, directors, producers, and emerging––bringing new styles and perspectives composers to develop new work. More than to cultural life. No single agency or individual 1,100 artists apply annually for 200 positions can set an artistic agenda for the nation; the in the Feature Film program that includes an contrasting values and tastes of different funders initiative for Native American filmmakers. ensure a rich diversity of art works; tax incentives promote innovative methods of private support; and decentralization helps regional heritages and local communities retain their integrity. university libraries put books in the hands of What we see today is the spirit of American readers and boost the reputations of commercial enterprise—in the past so successfully applied authors. Libraries also provide a steady demand to commerce, technology, and politics— for low-selling works. This makes it easier for increasingly applied to the art world. In its authors to market their ideas to publishers, comparatively short existence in the life of provides modest royalty support, and gives civilizations, the United States has produced a authors a chance to find a larger reading grand legacy of lasting cultural achievements, audience. and leaders are fast recognizing the centrality of artistic expression to a healthy society. “A great nation deserves great art” is the motto of Conclusion the National Endowment for the Arts. The American arts funding is a complex and American system of free enterprise, coupled evolving system of entrepreneurial initiatives, with public support, is a proven means of philanthropic foundations, and government fulfilling it.

20 HOW THE UNITED STATES FUNDS THE ARTS

AXIS Dance Company of Oakland, California. Photo by Marty Sohl

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REFERENCES

Archambault, Edith. The Nonprofit Sector in France. Dimaggio, Paul J. “Decentralization of Arts Funding Manchester: Manchester University Press, 1997. from the Federal Government to the States.” Public Money and the Muse: Essays on Government Funding Barbetta, Gian Paolo. “Foundations in Italy.” Private for the Arts, Stephen Benedict, editor. New York: W.W. Funds, Public Purpose: Philanthropic Foundations in Norton & Company, 1991, 216-252 International Perspective, edited by Helmut K. Anheier and Stefan Toepler, 1999, 199-218. Frey, Bruno S. and Pommerehne, Werner W. Muses and Markets: Explorations in the Economics of the Arts. Benedict, Stephen, editor. Public Money and the Muse: Cambridge,. Massachusetts: Basil Blackwell, 1993. Essays on Government Funding for the Arts. New York: W.W. Norton & Company, 1991. Giving U.S.A. 2003. American Association of Fundraising Counsel: Bloomington, Indiana, 2003. Clotfelter, Charles T. Federal Tax Policy and Charitable Giving. Chicago: University of Chicago Press, 1985. International Data on Government Spending on the Arts. National Endowment for the Arts, Research Cobb, Nina Kressner. Looking Ahead: Private Sector Division, Note #74, January 2000. Giving to the Arts and the Humanities. Washington, D.C.: President’s Committee on the Arts and the Legislative Appropriations Annual Survey, Fiscal Year Humanities, 1996. 2003. Washington, D.C.: National Assembly of State Arts Agencies, 2003. Coombs, Philip H. The Fourth Dimension of Foreign Policy: Educational and Cultural Affairs. New York: Mulcahy, Kevin V. “Government and the Arts in the Harper & Row, 1964. United States.” The Patron State: Government and the Arts in Europe, North America, and Japan. Oxford: Cowen, Tyler. In Praise of Commercial Culture. Oxford University Press, 1987, 311-332. Cambridge: Harvard University Press, 1998. Schuster, J. Mark Davidson. Supporting the Arts: An Creative America: A Report to the President by the International Comparative Study. MIT, 1985. President’s Committee on the Arts and the Humanities. Washington, D.C., 1997. Schuster, J. Mark Davidson. “Questions to Ask of a Cultural Policy: Who Should Pay? Who Should Cummings, Milton C. Jr. and Katz, Richard S. Decide?” Culture and Policy, 7, 1996, no.1. “Government and the Arts in the Modern World: Trends and Prospects.” The Patron State: Government United States Urban Arts Federation Fiscal Year 2002. and the Arts in Europe, North America, and Japan. Washington, D.C.: Americans for the Arts, 2002. Oxford: Oxford University Press, 1987, 350-368. Wyszomirski, Margaret Jane. “Background on Cultural Cummings, Milton C. and Schuster, J. Mark Davidson. Policies and Programs in the U.S.” Comparing Cultural Who’s to Pay for the Arts? The International Search for Policy: A Study of Japan and the United States. Ed. by Models of Arts Support. New York, New York: ACA Joyce Zeamand and Archie Kleingartner. London: Books, 1989. Altamira Press, 1999.

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A Great Nation Deserves Great Art.

1100 Pennsylvania Avenue, N.W. Washington, D.C. 20506-0001 202-682-5400 www.arts.gov